Authorised Deposit-taking Institutions

You should also check whether the account is offered by an
Authorised Deposit-taking Institution (ADI). ADIs are regulated by
the Australian Prudential Regulation Authority (APRA) so your
money is safer with them. Check whether the institution offering
the account is on APRA's list of Authorised Deposit-taking
Institutions.

If you're a low income earner you might qualify for a
savings program, offered by some charitable organisations. For
more information see
other programs for low earners.

Find a basic bank account

Some financial institutions offer basic bank accounts with:

No account-keeping fees

Free monthly statements

No minimum deposit amounts

No overdrawn fees.

You can find which financial institutions offer these basic bank
accounts on the Australian Bankers' Association's Affordable Banking
website.

How savings accounts help you
save

Savings accounts are specifically designed to help your
savings grow faster. They offer a higher interest rate than basic transaction
accounts. Some also make it harder for you to access your money so
you are not as tempted to dip in. With more money saved, you will
be able to take that dream holiday or save the deposit for your
first home sooner.

Online savings accounts

Most people choose an online savings account, which is
convenient because you can easily transfer money from your
transaction account to take advantage of the higher interest rate.
These accounts encourage you to leave your money alone so it can
grow through compound interest. Some accounts even
reward you with higher interest if you make regular deposits into
the account.

Remember, online savings accounts may give you less access
to your money than ordinary transaction accounts.

Compound interest

Compound interest is like double chocolate topping for your
savings. It helps you to save even more. Find out how compound
interest works.

Savings accounts for kids

There are savings accounts specifically for children that reward
them for making regular deposits. However, it is important to
understand how income earned in these accounts is treated for tax
purposes. Check with the Australian Taxation Office
(ATO) to see how these accounts are taxed. Setting up one
of these accounts with your child gives you the chance to talk to
them about the value of saving. For more information see teaching your kids about
money.

Paying tax on your
savings

Remember that any interest you receive from your savings account
must be declared in your tax return. For more information, see the
ATO's investment income
webpage.

If you are serious about trying to save, open a
savings account. You can take advantage of their higher interest
rates to help reach your savings goals sooner.